Question

Q1: A nation suffering from high unemployment would welcome:

Select ALL that apply (I picked a) and b) and got partial point

a)A wave of foreign investment

b)currency depreciation

c)effects of less expensive exports

d)currency appreciation

Q2: A country is said to have an absolute advantage in the production of a good when:

a)its opportunity cost of producing the good is lower than another country.

b)it can produce the good using fewer resources than another country.

c)it specializes in the production of the good.

d)all of these.

Q3: An increase in the equilibrium price of Japanese yen per dollar could be caused by a(n):

* answered a) was incorrect

a)increase in the general level of prices in Japan.

b)increase in the U.S. demand for domestically-built automobiles.

c)decrease in the U.S. income relative to the income in Japan.

d)increase in the supply of dollars on the foreign market.

Q4: Protective tariffs help a nation reach which of the following goals?

a)Decreased domestic consumer prices.

b)Increased domestic employment.

c)Increased amount of goods for consumers to purchase.

d)Increased competition among domestic and foreign producers.

e)None of these.

Answer 1

Question 1

Wave of foreign investment will stimulate production in the economy which in turn will lead to job creation and reduction of unemployment.

Currency depreciation will make the exports of a country cheaper and imports expensive. Both these will stimulate the domestic production and will reduce unemployment.

If exports of the country become less expensive then export-oriented industries in country will increase production which will create jobs and will reduce unemployment.

Hence, the correct answer is the option (a), (b), and (c).

Question 2

A country is said to have an absolute advantage in the production of a good when it can produce the good using fewer resources than the another country.

Hence, the correct answer is the option (b).